Safehold Secures Two California Affordable Housing Ground Leases
Event summary
- Safehold closed ground leases for 211 affordable housing units in Santa Cruz and Santa Clarita, California.
- Projects will be developed by CRP Affordable Housing & Community Development, a new Safehold customer.
- Developments are Low-Income Tax Credit projects, with completion expected in 2028.
- Citi Community Capital provided construction and permanent financing for both projects.
The big picture
Safehold's latest deals underscore its push into affordable housing, a sector facing acute supply shortages in high-cost markets like California. The ground lease model allows developers to access capital more efficiently, but Safehold's ability to scale this approach will depend on securing more partnerships with specialized developers like CRP. The company's strategy aligns with broader trends in real estate investment, where tax-advantaged affordable housing developments are increasingly attractive to institutional capital.
What we're watching
- Portfolio Expansion
- How Safehold's entry into California's affordable housing market will impact its geographic diversification strategy.
- Execution Risk
- Whether Safehold can maintain steady growth in its affordable housing portfolio amid regulatory and market challenges.
- Customer Relationships
- The pace at which Safehold can onboard new development partners like CRP to scale its affordable housing platform.
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